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tv   Squawk on the Street  CNBC  March 3, 2014 9:00am-12:01pm EST

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thank you, warren buffett, very much. becky, safe travels, although who doesn't want to spend at least a couple of days in omaha if they get a chance. >> sure. >> maybe you won't be back. becky, join us tomorrow. right now, jacques a"squawk on street" is next. good monday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer david faber at new york stock exchange. if you had a great weekend we kick off the trading month of march with futures in the red. escalation in the ukraine over the weekend will take a toll after the s&p did hit all-time highs friday. ten-year has a lot to react to today. manufacturing, ism in an hour and jobs numbers coming up friday. europe's losses are roughly in the 2% range. germany right now, among the hardest hit.
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markets, unpressure this morning, due to the escalating situation in ukraine. monthly increases in consumer income and spending not making a dent. warren buffett says he's not discouraged about the markets today or in the future. citing slow but steady economic improvement. find out what else he's thinking about. >> apple rolling out carplay technology with mercedes and ferrari? futures pointing to a sharply lower open, thanks to ongoing instability in ukraine and russia. this, despite monthly increases in both consumer income and spending. jim, we knew monday was going to be interesting all weekend long. this is not the kind of thing you prefer to focus on but it's what's on the table. >> we got lucky. we had one of the most amazing three hours i've ever seen on our network where warren buffett really just basically laid out the cards at the annual letter, also fantastic. but his take away was my takeaway, this is business as
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usual. talking about buying something in london, too, was more impacted than we are. look, if you're trading ruble, if you're trying to figure out whether to the level to buy yandex, concerned about the energy situation in germany, yeah, i mean maybe not time to pick things up. i agree with warren buffett. not hard to do, obviously, given his long-term track record. this is where you pick. you're getting a chance. he had a big sell-off friday afternoon and he kind of rallied in the last half hour. if we get those prices again at 330, count me in. count me in. >> fixing my collar here. always important that you look well in the morning when delivering and trying to opine and provide insight. >> the clothes make the man. >> of course on that note, studying up on ukraine and crimea and russia's history with it, and what khrushchev did in
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'54, whether he gave to them, whether thhe didn't want to dea with it. this forces money manages are to hit the history books. >> my producer, ukraine is -- actually i read the stories, warren's say, remember, 50% of the whole country is russian and the crimea is russian. so, this is kind of a -- apparently there's questions about resources and they use a lot of water in crimea. >> ukraine. >> a lot of gas goes through the whole area. >> there's where the stranglehold is. but let's remember that we have seen time and again crises in other countries that have driven down our markets and we were at all-time highs last week and had a series of crises. is this more different, is this that difficult versus the dennis
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rodman basketball situation with north korea? >> we managed to survive that. i don't know how. >> one wonders whether the markets will have an impact in russia as the ruble falls to new lows, as the stock market gets hit very hard. i have no idea whether mr. putin cares. but it's interesting to watch. >> there is something really -- you came back from sochi, isn't it interesting the timing? what was the olympics have been like if we had been -- >> would the u.s. have pulled back? paralympics continue now, an interesting place to be reporting on sports. we are mentioning and keep our eye on ukraine. jim maceda live in moscow with the latest. good morning to you. >> reporter: hi, carl. there's a lot of talk about ukraine being on the brink of war, and here's why. right now there are thousands of russian forces who have either occupied or surrounded crimea's airports ferry ports, telecom
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towers and government buildings. at the same time surprise war games are still going on, which means about 150,000 troops and 900 tanks through the equation, continue maneuver as long ukraine's border with russia. it's adding more risk of a misstep. putin himself observing games near st. petersburg today. supposedly the last day of the games. we'll see whether that's true tomorrow or not. now putin has another weapon, he can legally use force because of a law passed over the weekend, anywhere in ukraine, not just in crimea. if he decides that the russian interests are threatened. on the or side of the standoff you've got ukrainian military, they're big, second largest in europe, on high combat alert. there is a mass call-up of all men under 40 going on as we speak. over the weekend, ukrainian's prime minister called putin's action in cry meimea a declarat
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of war. this is not a game. ukraine is on a war footing. so far it's been more of a war of words and nerves, not a shooting war, that putin's taken crimea, in fact, without firing a shot. and now there's one that i think positive sign out of all of this, and that is that putin has agreed that telephone call to german chancellor merkel to call a contact group, international observer, stamall group would he a small dialogue between kiev and moscow, which isn't taking place now, but could be a breakthrough, we'll see. >> jim maceda today in moscow. warren buffett speaking out saying he's not discouraged that the market's under pressure today. also commenting on the keystone pipeline, saying he would vote yes to approve it. >> do you think keystone should be -- >> a would vote yes.
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>> wyou would vote question for keystone. energy and job creation, pipeline's an energy renaissance what jim's pointing out. >> i don't believe in the keystone pipeline because of the -- you can build anything and create jobs but i believe -- i just believe it's a useful pipeline. >> i was going to say he agrees with you, i hear your name, i think it was you, jim. >> thank you, becky. amazing job by becky. this is important, burlington, railroad, they're bringing -- that's a big oil railroad. but he's a huge pipeline owner. this is important because this is a nonpolitical guy, not like jim cramer but this is right thing to do. and obviously it's all up to the president. but i thought it was interesting that he didn't say it was a jobs, it was common sense way to get oil. and when you look at what's happening in europe, don't you wish germany, don't the germans
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wish they had continental independence of russia. >> wide-ranging interview this morning. covered bitcoin he doesn't think bitcoin will be around in 10, 20 years. >> wasn't that something? >> coke has pressures ahead, like they've never faced. >> pepsi should stay under one roof. >> interesting story from jim stewart in "the times "s about coke's challenges. >> warren buffett pointed out international is the way to go. but i think jim stewart -- also mentioned, the -- jim stewart's piece is saying, this is the twilight and that the united states is the leader, so don't believe other countries are going to continue to drink as much. when i went to mexico -- >> carbonated beverages. >> mexican tax was against obesity, mexico forward country since change in leadership, this is happening right now,
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happening worldwide. >> the critics, of buffett who are upset about his lack of transparency on derivatives, right, all of those things, tax inefficiencies that they worry about after he passes, when he passes. >> i think people have to read the shareholder letter. he's underperforming, look, in 2000 -- in 2008, he was down 9. market down 37.0. he says overand over, my job's not to shoot the lights out during the upmarkets but protect the downside. if you read the letter and think real problem's with transparency, he mentions the terrible texas deal he was involved in. >> energy partner had to take a write-down. >> he shows you how he makes decisions. read other annuals, other annuals are about, we have a pretty good toothpaste, you know? others are about don't rule us out against the -- our food wars because like we're still selling
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a lot of tvs. honestly, it's like, hey, open up, make folksiness. >> like the intelligence. he's 83 years old. we should all be so lucky to have that kind of a brain still operating at that age. >> talking about how ache approaches new ideas. >> they had a conversation about stocks, which -- about directv. >> i loved it. talked about insurance in the letter. but how it's cutthroat. fischman would argue, yes, not -- there are just a lot of little nuggets about why he likes certain physicists. >> and the idea -- they need to make large acquisitions but along the lines of heinz, they partnered, more over time, but perhaps a model for future acquisitions.
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for a company to move the needle it needs to be pretty big. >> it's interesting to shut applauup about that so valuations come down. what do people want? invite three journalists, a credential bear what do they want from him? what more does he have to do? basically talk -- talk about what he does on a day-to-day basis. i don't know, people -- read some other reports. you're not getting this level of grantlarty. >> forbes out with its billionaire's list. we'll discuss that with the magazine editor? the former chair of goldman sachs, jim o'neill, who better to talk about geopolitics in ukraine. we know what the tone will be. more "squawk on the street" in a minute. r how ta the building is, or how ornate the halls are. it doesn't matter if there are granite statues,
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[ male announcer ] these types of plans let you visit any doctor or hospital that accepts medicare patients. and there are no networks. you do your push-ups today? prepare to be amazed. [ male announcer ] don't wait. call today to request your free decision guide and find the aarp medicare supplement plan to go the distance with you. go long. >> another winter storm is pounding parts of the united states today. federal government in washington, d.c., shut down due to the weather. weather channel's jim cantore live in d.c. he brings us the latest from there. jim? >> reporter: good morning, david. kind of a nasty one. expecting 3 to 7 inches of snow, we've got an inch and a half on the ground. of course, it continues to come down in earnest. look back and you can hardly see the capitol. i mean it's very, very low in terms of visibility.
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winds gusting to 35 miles per hour. we went from 37 at midnight to now 21 degrees, which is incredible cold. we'll get down to single digits tonight, possibly record low the storm is impacting a swath from california across the plains and really from just south of new york down through philly and into d.c. probably further. we can wind up in a situation here where some of the heaviest snow totals may be to the south of d.c., which is pretty rare for the month of march where you average 1.3 inches. we'll see 3 to 7 here before all is said and done. most places will see about that. we've got 5 inches in gaithersburg. roads behind me aren't bad. remember, there's no hills here. this is all pretty much straight here on 4th avenue. obviously covered and packed. underneath all of this snow and powder at 21 degrees, it's absolute ice. imagine if you're in a car, rolling over this thing time and time again, you pretty much pack
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down this icy cake whether it be a sidewalk or a road. so anybody that doesn't get this stuff up before tomorrow morning, we're talking about sing single digits. over 2100 aircraft not flying because of the weather. 62% of outbound fleet at reagan canceled today because of weather. we may get improvements afternoon time today here but again the cold and refreezing of all of this that has everybody worried for tonight. good news. back to you. >> in like a lion, as they say. jim cantore in washington. apple's coming to your car. the company making a big move introducing carplay. a new way to use your iphone in your vehicle. carplay will debut first in ferrari, mercedes-benz, volvo and allow drivers to make voice calls or dictate messages with siri. third party services leak
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spotify and i heart radio. we know how big a market this is. >> look, i think all of us who are hooked up and love to make the calls, one of the cars i have, great recognition with voice already. this is a terrific thing to have. at the same time, those are not mass cars. >> no. >> you know the car's a battleground. we talked about it a lot. it's clearly something in the focus for apple beyond just mapping technology. they've got lots of competition. >> they've got self-driving ones. >> in terms of the phone business, everybody's talking about ellen degeneres holding a samsung during oscars, taking that selfie, which is the most retweeted tweet of all time. reports that she was caught using an iphone backstage, though samsung was a huge sponsor of the show last night. >> i think that maybe that's the -- it's another twitter night, i wouldn't be surprised that twitter rallies today
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because of that cultural influence which does matter in america. >> a big social media editor i know wrote last night was night that twitter beat facebook in the social culture tv war. is that true. >> >> look, i think that there's a lot of room for winners. i do believe that twitter, the fact it didn't sell down after that last quarter, people believe they've got a lot of things cooking. >> they think they'll take on and succeed in fixing the user growth problem. >> right. >> which is still an issue because it's complicated. >> true. >> it's not as easy as it should be. >> guys that are most influential, adam scheckter, a good friend, but what this is, that's how you get news. scheckter is news for fantasy news, that's what you need. you need to see people who don't tweet getting on twitter to get that info. >> interesting psychological.
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>> first trading day of the month. what stocks will we be watching? "mad dash" next. one more look at futures. weakness due to the situation in ukraine. take a closer look at your fidelity green line and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy to move that old 401(k) to a fidelity rollover ira.
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earnings and is in the midst of trying to split off red lobster from the rest of the company, facing opposition from 5.5% shareholder. >> i think this is important, david. the trends for red lobster, going up, talking about red lobster, the spin-off, same-store sales in december minus 10, january minus 12. february minus 4.5. traffic is terrible, too. i question, david, when we see these strength, we see split-offs, what happens is that the other piece might be attractive. who would want this red lobster piece? i don't know. i mean, the rest of the company would be strengthened by getting rid of red lobster. this is not two minus one equals two different pieces that could be good. it's two of which the darden leftover is excellent, but like when you split out cola, he
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would say the portion of alcoa you don't like, might go under. do very poorly. this darden split up is not -- i don't think that the shareholders would want this. i really don't. >> trying to get them to have a shareholder vote on it or a proposal that would at least show dissatisfaction amongst that base for -- >> they say, listen, we're not going to do real estate investment trust thing. other numbers are bad. maybe that's the issue, numbers are bad. >> they've been bad for a while, even before bad weather. >> we'll be watching darden with many others. opening bell, right here on "squawk on the street."
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♪ [ tires screech ] chewley's finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. get the most extensive charting wherever you are with the mobile trader app from td ameritrade. watching cnbc "squawk on the street" on monday morning. live from the financial capital of the world, kicking off the month of march here, two-thirds of the way through q1. busy week, manufacturing data later on this morning, jobs number friday. get costco and staples earnings, auto sales, a take on what the weather's doing. meantime, guys, david, what got lost friday night might have been reports about the future of
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j. crew and mixy drexler. >> yeah. >> reports of the journal, one story, interesting, i sometimes think about if it was public, you think who would leak it, why would you leak it early in the process, because it was a story they had been approached by japan's -- >> shockingly big. shockingly large. >> i will tell you, a lot of respect i think on the part of j. crew's owners for that management team in japan. for that retailer. we know, as private equity firm what are you in business to do? in business to take things private and take them public and/or sell them, sometimes a lot cleaner to make a sale to an acquirer as opposed to taking something public which ppg has done once with j. crew and then, of course, having bought it for who's to $3 billion not many years ago no. >> early to turn that -- >> huge home run.
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mickey dprrexler one of the reasons to go private, question i have, will this company say listen, mickey, other places that mickey had to work for -- >> i don't know the answer. i don't know the answer. i do know there's respect for mickey and ppg and the japanese. they've grown very quickly, of course. the flagship on 5th avenue, see what they're doing in terms of trying to get people in stores and doing innovative thicks in a store to get traffic. >> brings up the broader question of exit. the grubhub on friday, four ipos this week, m&a at a precrisis high. there's some things boiling here. >> yes. and there was a margin debt story, we'll seal the stories at given times. back to warren buffett. warren buffett saying, look, a lot of value in the market. again, i know that there are
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people who are tired of warren buffett. i don't know, like maybe you tire of the oscars. you still watch them. i think that there is a sense, to me, that the company still believes there's great value in the market even if the pundits of which, by the way, warren buffett takes aim at pundits, say there isn't. he took aim at macro pundits, people who opine on macro, they're giving me a great opportunity to buy stocks i agree with that. koejent analysis about the macro people, the risk on/risk off. >> we mentioned heinz earlier. buffett said they intend to hold that forever, in his words but that's not to say others might want to exit in the next few years, as he says, if numbers get better, he believes they will. >> in terms of his partner. we talked a lot about, quiet gentleman, who i don't believe ever appeared on cnbc, 3g,
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burger king as well and heinz. very interesting. consumer products, like heinz, ketchup, every year, and a lot of other things, but there's a return you know coming at you. >> chinese aren't -- the chinese got of ketchup, people read about the railroad analysis, how undervalues, parts of the indices that help. >> we want to get to the bell. remember they bought it with cheap debt, that's warren buffett, and the others like him, john malone, using capital markets to their advantage to buy the cash flow businesses that will give them the return they expect over manyiers locking in low borrowing rates. >> implying that we can't do that individuals or companies can't do that maybe there's a special status. >> a look at s&p, negative this moring here at big board, knowles corporation, celebrating a spin-off from dover and at the
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nasdaq, boulder brands doing the honors today. look out for auto sales. we've gotten chrysler. >> and there's ford, down 6.1 versus down 5.1. i've continued to say this is into the important period. like employment number friday, three straight downs, that would be worrisome. but the weather, a lot of people saying the weather doesn't matter. i mean the weather -- you know, go buy a car, if the car dealer's closed, you don't. it's okay. it's okay analysis. country worst weather nationwide since 1977, not fact that? that seems silly. >> phil lebeau tweet what the impact of airlines. we'll talk to gordon bethune, cost to passengers and airlines from delays and cancellations 75% higher than recent winters. >> those stocks, other than united, on fire. the day that they reported that,
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united, down a couple bucks. and amr was flat. >> airlines extraordinary. >> best performers in the group. >> positive on them for a while now. >> i really like them. i just think that that's because the lack of competition. there isn't -- you don't get competitive root structures in a lot of places. >> thank you doj. >> the doj, people critical of the doj's decision, that there's always been -- >> wow think they would have got eat in court if they would have tried. talking american airlines. >> it's important to focus on the fact that this group is the market leader at a time when oil is through the roof. the reason why there's a long-term bull market in airlines, that boeing makes, the aircraft are far more fuel efficient and talking about the single biggest determine nanant
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profitability. you check thointo the markets o beaten price, prices are gigantic. >> jim mentions the ford numbers, phil lebeau has more on that this morning. phil. >> how are you? we've got ford and general motors. start off with ford coming in with february sales declining 6.1%. that's alittle weaker than the stinlt of 5% for the month of february. general motors down 1%, better than the estimate was for the decline of 5.4%. so, you're going to get a mixed bag, not supergreat numbers but we want to focus on sales conference calls, what do the executives say about two things? february and january being weak, the bounceback in march, and q1 and q2 production schedules. we'll be on those calls today. there you have it, ford and general motors reporting slightly negative sales for the month of february. back to you. >> thanks a lot. phil lebeau in chicago.
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overall, jim, dow's down 131, biggest decline since a month, february 3. >> i hate up openings on monday and i don't mind down openings. obviously the idea you can look through ukraine when tomorrow can be another day, be careful what you do buy. i find a lot of energy stocks are down today that makes no sense to me. they are a good place to be, that would be the first place to buy, the energy stocks. >> exxon and chevron up very, very, very slightly. >> but spread between what they they are able to sell, take it out of the ground, what they can sell it for goes up, so eog, and i'll doing a lot of work on, that's a place to go. >> interesting story in "the journal" about the refiners, we haven't created a new refining -- a giant refiner
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sinceance ancanc '76 but smalle >> right, go back to what warren buffett said about keystone, the most of the infrastructure down in the southeast was prepared to refine that oil, heavy oil. the light oil we need refineries we've been shipping oil to the northeast to refine it. where they've learned how to refine nigerian crude and we've got to get that oil that is the cleanest, clearest oil, therefore, of course more, flammable, that's one of the things people talk about, they need refineries. watch the group, it's been quite bad, reevenries because of the narrowing of the spread. >> 1845, levels technicians looking for a bounce going into the morning session here. >> we've got a lot of high flying stocks, like
9:36 am, touching that level, exceeding that level, that het it on friday. swing of sale force 67 to 60. those who bought quarter was not good? i don't know a sole. it was a very good quarter. that's where you go, besides oil. oils are now up. that was your moment, i guess. >> to change the subject, i got a kick out of friday you in a tuxedo on "mad money" giving away the golden bulls. >> right. >> that category, you had viewer input, viewers, for instance, wanted in terms of best picture, wanted facebook. >> yes. >> you were you going with chipotle. >> i had the actor behind the promotion, some say propaganda of chipotle, the dangerous, the industrial farm information bureau, i gave it to disney for bob iger, best director, why not? look at what he's done with the
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stock in the buyback is incredible. and, yes, facebook, my travel trust has been buying because it's coming in, the readers -- viewers are very smart and viewers selected facebook, i think many are on facebook, including younger and older, and recognize the company's a profitable company. this is not 1999 when it comes to facebook. it's important. >> within technology. apple, we spoke about earlier, particularly this idea they're going to move more aggressive. it is up. >> that stock got hammered. there's no icahn today. >> there's ike. >> there is. >> yes. >> a report coming up. normally we would have talked about it. >> how many days in a row can you lead with another icahn letter? fourth day in a row. >> talking about thousands of points of light of journalism. >> now carl's using hashtags in his tweets. >> he's ahead of me.
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>> i haven't gotten a hash glag selfie today. >> cate blanchett uses the word hashtag in her speech and carl using it. >> patrick stewart right over there and told you that this is everything. twitter? >> down 1%. i thought ellen did a good job. another network. >> yes. >> iger network. shots of iger in the audience. >> i still watch it. >> the whole thing, of course. >> i still watch it. >> we're paying the price today but i did watch the whole thing. the dow's down 124, bob is on the floor. >> good morning. what does the ukraine mean for the global markets? risk off right now. what it certainly means, at least now, even if it's resolved shortly, another headwind for global growth. is that a tough winter in the u.s., that's a headwind.
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ukraine's a bit of a headwind on how serious it is and how long it takes to resolve. that will determine how much of a headwind it is. you see the european markets down 2%, 3%, russia down 12%. nobody believes it's going to deter mr. putin. commodities are up, noticeably here in the u.s. wheat, oats, corn, all notably on the upside. oil's on the upside, that's helping the energy stocks, gold's on the upside as well. people speculated this might help agricultural companies potential potentially, ukraine being a major ex-porter but it's not happening now. agricultural names like archer daniel midlands down but not down nearly as much. some are modestly on the upside like agrium. financials and industrials, ones down the most. energy is about the only sector -- i can't see all ten from here -- but that is slightly on the upside. most of the energy spots, bigger names, chevron, exxon, marathon,
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conoco, up slightly or just down fractionally. at the moment, of course, not surprising, gold stocks on the up side as well. the big debate here, and there's a cynical position that a lot of people have, let's hope that we can keep the ukraine in the west. but what happens to the rest of us if that happens? ukraine is bankrupt, they need by some measures 30 billion to 40 billion in aid, 4 billion immediately. does the west have the money or the interest, the monetary will or the political will, to deal with that? in other words, what happens if we have a modicum of victory here? we should have those problems. back to you. >> well, as we said earlier, ebay/icahn argument, if you will, goes on. interestingly, it's evolved in some ways from what is ostensibly still a debate about the splitting out paypal business from ebay to this distribute that is more and more
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focused on actions of director mark andresen and the skype deal under which ebay sold skype to an investor group which in which andreessen's firm had a small percentage ownership. this morning another, in terms of consecutive trading days, letters from icahn, at least third in a row. and we get the response quickly. we also have for the first time, mr. andresen's response and defense of his own actions on his website. in fact, i tweeted that out. apologies came out if it was looking like me. his website and his defense that i wanted to get out to people because it is the first time we've heard from mr. andresen. this morning the new icahn letter to ebay stock holder doesn't say much about paypal. it's wanting to know the truth about what happened with skype, raising questions about what ebay directors new about
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microsoft's interest in skype. 18 months later the investment group that purchased skype from eb ebay, but ebay helped 30% of the company and managed it from a higher price when it was sold to microsoft, about $8.5 billion. did mark andresen know at the time the group was purchasing a controlling interest from ebay that microsoft was interested. did he enter into a confidentiality agreement that prevented sharing information. a lot of questions continue. want to get to the broader issue in a minute. a manresponse from ebay and mr. andresen himself. he says, for example, ebay's retained ownership in the skype spin-off 30% versus andren's approximate 3%. that ownership gave ebay a bigger role in decision making after the spin-off than
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andresen, as well as far bigger economic pay-off on the sale of microsoft. true, a lot more from mr mr. andresen defending himself. this larger issue is an interesting one and i've been trying to talk to a number of the people who sit on boards of big technology companies who are not venture capitalists, there is a conflict in a lot of venture capitalists sitting on boards, people looking for exits, to fund the next disruption, people who conceivably have a lot of different plays in place at any one time. i have to say, i have gotten an affirmative response saying it is something worthying about. >> right. there is -- i don't want to say double standard. but out west, it's like a we've got all of these people involved in the areas and they know and this expertise and it's the way that we -- >> help us. let me end with andresen on
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this. some people have floated a theory that venture capitalists are more prone to potential conflicts than other kinds of directors. i don't think it's true. hedge fund managers tend to hold equity stakes in many companies at same time, creating the exact same kind of potential conflict. i was cited examples, nonetheless, eye opening, or some directors believe that others who sat on the board who had venture capitalists in other companies should have the been doing a full a job as they were designed to protect. >> i don't know, i started this street com and guys involved, competitors coming together, a venture capitalist, that's how you do it. >> so crowded corner of our economy with some very large player, it's hard to turn around. >> technology companies, i mean, you need a guy who understands
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what's happening here, there. i don't know, like carl icahn but i understand the other side of the equation. >> only icahn would go after andresen but andresen defending himself with his own letter. >> bonds and the dollar, rick santelli in chicago. good morning. >> good morning. of course, what's going on in ukraine, having an effect in the marketplace. however, how large an effect, how long lasting will be debated. one day, two day, charts of tens will show you, 2.65. down one point. lowest yields in february. year-to-date of 30s. lowest yields since early february. we can take some areas out, traders are looking for momentum trade in that regard. if we look at what's go on with some of the foreign sovereigns, let's look at bund, hovering at yields since july of last year. look at uk ten-year, lowest
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yields since november. what happens to flight to safety on the dollar index and stocks? dollar index trading under 80, you can see hovering in the zone just a few ticks away from an area we haven't seen on a closing basis since october of last year. we look at euro versus dollar, interesting chart, it's not right on the highs but it was on the highs, close to the highest level in a closing basis that we've seen since, well end of 2011. that's the trade that's surprising traders the most. back to you. >> thank you so much. see you in a few minutes, rick santelli. warren buffett's thoughts on big blue. got to stick around for that. later on, the "pawn star" rick harrison, compete and american consumer on a big week of macro da data. early movers. we've not had a positive first day of month since november and today's no different. dow down 120. there's this kid.
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save you fifteen percent or more on car insurance.ould yep, everybody knows that. well, did you know the ancient pyramids were actually a mistake? uh-oh. geico. fifteen minutes could save you fifteen percent or more on car insurance. warren buffett defending new ibm ceo, take a listen.
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>> she got handed the company at time of a real transition in the business, and her record, i feel fine with her at this point. but her record will be judged, you know, five years from now. there's a lot going on in that business, and i think they're doing well, but the final score will be five years or ten years from now. >> read between the lines. that hurts. >> right. that was not, listen this is a not one to be on. remember, traditionally does not like technology stocks you can see that in old interviews. this is a tech company and not doing as well as other companies that he owns, with exception of coca-cola, coca-cola international. a tepid endorsement. >> i feel fine with her. >> i think you can go further if you wanted to, and he has in terms of being more -- >> right. knowing her, that wasn't the
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time for cramer and "stop trade." i've got to tell you something, news this morning that if you're focused on microsoft, if you're focused on what dell's going to do you're flabbergasted this morning because the big, big bump up here for mark penn, making him chief strategy -- look, he's an old friend of mine and steve ballmer, we went to school together. he was democrat of operative with clinton. so this guy to move up is to say, wait a second, i'm sure say some say is it business as usual? a guy who devised how people
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think about microsoft moves higher, not lower? to me sounds like maybe the change to misquote sam koch is not going to to come. >> nicely done. tesla today? >> jpmorgan we see this over and over again, the stock is overrun, using a metaphor there, jpmorgan raises price market. using 20/20 volume numbers, 20/20 foresight. instead of making 228,000, they'll make 288,000. i point out the ease which they raised $2 billion. >> one of the largest raises in quite some time. >> amazing. >> it is amazing. 1.25% on 7-year, not like they're pay you a lot of money, and up 40% on the conversion. >> this is -- i found this flabbergasting. i've got to tell you, i didn't give every single award on my friday show "mad money" to elon
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mu musk. i thought warren buffett would say, who's the next billionaire, i thought he might say musk. >> tesla's not done. >> one thing, target, it's not 320. >> yeah. so many bears doing everything they can to inch up toward -- >> yeah. >> down 80 from the current price. i should short the stock? >> taking the egg, ham and cheese off this guy's face, slowly one piece at a time. >> tonight. >> ice sis, one of the hottest stocks, dr. strandly crooke. >> isis one of the two or three leaders, rna science, stay focused on biotech. >> what a run. great stuff, jim. steve balmy, mark penn. >> things showing. see you tonight. when we come back, or ra al of
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ho omaha talking ibm to keystone pipeline. becky will join us from the break with more of her three-hour interview. later on, gordon bethune on the latest challenge airlines are facing as march comes in like a lion with another snowstorm hitting several states hard. "squawk on the street" back in a minute. ♪ for access to one of the top wealth management firms in the country. ♪ for a team of financial professionals who provide customized solutions. for all of your wealth management and retirement goals, discover how pnc wealth management can help you achieve. visit to find out more.
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welcome back to "squawk on the street." expecting a couple of date, contemporary february read on ism and construction in january number. on ism, 53.2, better than expected. 53.2, just to give you an idea, last look at 51.3. but if we go back in time, december, 56.5. obviously higher. we do see that prices paid, might be important as commodity prices move higher, 60 on prices paid. 52.3 on employment index, which will be a particular interest to everybody with adp and the friday number. that's unchanged from our last look. and if we look at new orders, 54.5, that's an improvement. construction spending, don't see it coming out.
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we know that washington's close ism's private, so at this point, expecting down half 1% for january construction. we'll have to put that on the wish list for now. i'm going to toss it back to sarah. when we do, and if we do, construction spending, we will put it at the bottom of your screen. back to you. >> ahead of the jobs report on friday. situation in ukraine intensifying over the weekend. russia has sent troops to occupied crimea cutting a mark reaction. latest on the crisis and u.s. option for action, jim maceda in moscow for us. good to see you, jim. >> reporter: well, over the weekend, we've seen various western officials led by secretary of state john kerry, mobilizing a kind of diplomatic blitz against putin's actions in ukraine. but besides this war of words analysts have been telling us the u.s. and its allies have few options when it comes to pressuring putin and putin knows
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that. diplomatic sanctions like boycotting the upcoming g-8 summit in june, sochi, they dent putin's pride but it's symbolic. economic sanctions, the u.s. has little leverage over russia. eu sanctions might have teeth, we're told at least. but it's reluctant to go there because putin could retaliate, spike natural gas prices. finance sanctions, like freezing putin's assets in u.s. banks might work but recall last year, the u.s. act did just that, to certain russian human rights abusers but the only tangible result was a russian ban on u.s.' option. what remains what we're seeing, diplomatic pressure. kremlin, we're seeing from here, hearing kerry's criticism. fo
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foreign minister lav aaron regent -- lav rov were unacceptable. putin appears unaffected by any of this pressure as he stays focused on what our sources are calling his main goal, which is reminding kiev, reminding the west, that the future of ukraine will only be decided with and not without vladimir putin. >> jim maceda, thank you. dominic chu, a market flash. >> good morning. four companies with exposure to the russian and ukrainian markets are getting hit this morning. check out kiwi, the paypal of russia, losing the most. companies like mobile telesystems a russian internet and tv provider, and there's yandex and a telecom service operator lower here. all operate in and around that russian ukraine region. market impact being felt.
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>> global markets falling as investors keep the close eye on the situation in ukraine. want to bring in art cashin, director for operations at ubs. joins us at post nine. good morning. >> good morning. >> 1845 here well enough. >> so far, so good, 1845-48. then 1841, two support areas if they were to violate that, that would be troublesome. market trying to assess what's go on here. all looking at pictures of troop movements and whatnot, the real battle is in things like currencies and what's going on. ruble has plunged. they've had to consider raising rates over there. can't make mr. putin too comfortable, but as jim maceda pointed out, there's no quick and easy diplomatic solution to this. so there's going to be little bit of a lagging and nagging
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concern. >> dom pointed out some of those are exposed directly with assets in russia. you see it in europe in particular. but actually, it's isolated here, isn't it? the likelihood it's going to impact in this market in a big way, even if there was a protracted stand-off that lasted for years, that may not impact this market at all. >> no, but as i say you look for the easiest areas of contagion and they tend to be quick shifts in currencies and then possibly things like bank loans. ute crane has had to put limits on withdrawals at banks because money was beginning to hemorrhage out of there. those things destabilize. you see neighboring currencies hit there the polish lobby, three-week low versus the euro. question for american investors, how do you think of geopolitical risk? you've seen really important risks like syria without a major market reaction in the united states.
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russia, obviously, much more economically important. doesn't that make it a bigger risk here? >> well, it is. you look at the syrian situation, you know, it's horrendous for the people in syria, but over here, it's a little bit more of ideological debate because it doesn't impact u.s. companies, it doesn't impact the currency. russia would be a much more formidable problem to have. mr. putin is not unhappy with the role of adversary here. think think this can drag out. you've got the market try to move up, and rick came out with the ism numbers and that was somewhat better, but the market is still testing and retesting here. like a patient who had a bit of a shock. he wanted to find out how far he can walk without getting a chest pain. >> a confident patient, isn't it? look at amount of debt people have taken on.
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we've hit a record of 451 billion of margin debt. you referenced in your importmo note this morning. it stands at moment an indication people feel confident. >> yes. being an old contrarian in the business, when everyone feel comfortable, that's the time to be a little uncomfortable. >> ukraine aside, first days of the month have not been good. haven't had an up one since november, what's that about? >> i think a temporary phenomenon. i don't think anything important about it. what you should note is it's confusing since the first day of a new month sees buyers. new money for the new time coming in. i think we've just had a couple of news events that have turned us. >> we look forward more economic date it and the jobs report on friday. >> i think friday will be a
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potentially critical time, depending where we are technically in the markets. but we'll see what the nonfarm payrolls come in and particularly the unemployment number. you know, still flirting with that air and the fed has not clarified that. so you know, we'll be looking. markets will be edgy coming into that. >> art, thanks. airlines grounded more than 4500 flights and delayed thousands more since saturday due to the latest winter storm. big airlines eased rebooking rules for passengers in the storm's path. the severe disruptions reported in washington's reagan national airport. joinings now, former continental airline ceo and cnbc contributor, gordon bethune. nice to see you. welcome. this seems to be impacting the airline on friday, issued a revenue warning because in the first two months of the year it had four times cancellations,
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believe it or not, that it had the year before. this is getting serious. >> as you know, first quarter's a challenge for profitability. this is going to impact revenues for the first quarter. i suspect guidance changing in near term. >> i mean it's not just bad weather. if all of the rules say you can't keep sitting on tarmac, you guys, former colleagues, running tighter schedules these days that demand faster turnarounds. i'm wondering if you're a victim of your own schedule. >> i think you schedule for an optimum weather and of course react to bad weather. the rules have impacted how airlines operate since it's against the law to stay out there for more than three hours, you cancel a flight. unfortunately for many passengers, there's no seat available on the subsequent flights so that's having an affect as well. >> state of the airline industry now, we've seen this on consolidation, the fact that the
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airlines are in cost-cutting mode now, does that make more cancellations likely, especially ahead of the storms. >> i don't think they do it on that base cnbc. the operational impact, they can't fly, let's say, when the plane is -- when the airport is closed. so that's going to affect revenue. this cumulative effect of the the weather, first quarter will have a big effect on profitability first quarter, for sure. what about the regional airlines in particular, gordon, that we report from the government accountability office on friday that said that they have got much deeper and widespread pilot shortages. the enfor instance inference cu salary pilot of $22,000 is not up to scratch and they can't attract talent that they need. and it least at the regional level. that is a concern. >> i think it's a concern.
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they've raised the entry level to $1500 which is expensive to achieve. of course the union sacrifices the first year pay so that they can have higher paid people in the later years so that structure probably needs to be addressed. entry level wages are too low to attract that kind of expensive education, 1500. >> sure. so it does escalate up. before we let you go, your reaction, if i may, to delta's move last week where it changed its loyalty scheme. broke away from the top three and said we will reward according to how much you pay for your flights, not how many miles you travel. so a lot of people that could signal the unraveling of the attractiveness of those reward schemes. do you worry for them? >> i don't, simon. i think it makes it more attractive for those spending more. so, it's a zero sum game, you have to give away and take away. it is going to change structure of how they reward you. i believe you should reward the
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people that pay you the most. i think that's what delta's doing. i think they're brilliant. >> i guess so. business customers worth three, four times as much as economy. good to see you. thank you for your time. >> former continental ceo and cnbc contributor. >> warren buffett speaking out on the economy. >> we haven't gotten wildly optimistic or pessimistic, the peer is small waves of pessimism and optimism. it's been pretty darn steady improving. >> slow and steady, he says. what about the companies in his portfolio? we'll get you the latest with buffett watchers later. later the man who coined the term bric and mints. jim o'neill, joining us to discuss the latest on ukraine. how that is impacting the global market. which makes you wonder. isn't that a conflict? search "proprietary mutual funds".
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could cheryl sanburg be making a senate bid? planning to run for a seat in 2016, likely mounting a challenge sense barbara boxer. the billionaire tech executive formerly served as chief of staff to larry summers during the clinton presidency. could easily finance her own campaign which would run $30 million to $40le. . stories i argue thinly reported there. but we will see. >> whether she has political
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ambitions, obviouslyquestion. one wonder why up against bongsbong bongsbongs boxer when feinstein's up in 18 and will be 85 and expected not run. a nasty primary campaign in a democratic state. >> facebook may be losing one of its rainmakers in term of modernization. >> i think it's part of the narrative, she's 44, ambitious, she has been as we pointed out involved in politics in a way, serving with larry summers years ago. >> $1.6 billion. >> made the billionaire's list for the first time on "forbes." following berkshire's shareholder letter, warren buffett sat down with becky quick who joins us with more from omaha. tour deforce, you guys covered everything from bitcoin, coke,
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ibm, activism. where to begin? >> you know, i thought we'd start out talking about what's happening today, carl. watch the major averages today, investors are spooked by what's happening in ukraine. the dow's down over 150 points similar to what the losses looked like when we sat down with them in the morning, premark trading with futures down over 150 points, too. but long-term investor like warren buffett, watching that situation in the ukraine doesn't spook him in terms of what you should be dealing with investments. he does say for people in the area, it's a horrible situation, watch from a humanitarian perspective what happens there. but he points out that, even in times of war, the place where you see the most punishment in terms of investment, cash loses value. what does he like now? he says for people who aren't professional investors, trying to invest at home but don't do this for a living he like index funds that track s&p 500.
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he says the low cost ones are the best ones. in his annual letter to shareholders he pointed out that for his liwife he has set aside money from her, of that 90% should go into vanguard index, the other 10% in bonds. it's a very, very low cost index fund and there are others, but there are others that aren't so low cost. keeping cost to a minimum is enormously important in investing whether it's farms or buildings in new york, but particularly in stocks. if you -- if you're paying out 1% or 2% annually, of your portfolio, that's a big, big tax that you don't have to pay. >> so, what does buffett not like now? bitcoin. he says that bitcoin right now, looks tulip like to him.
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>> it's out of kour recurrency. it does not meet the test of a currency. i wouldn't be surprised if it's not around. >> 10 or 20 years. >> why does it not meet the definition of a currency. >> people say i will sell you goods in bitcoin but they change the price. the pricing off the dollar, they can say, i'll sell it to you in barrels of oil but every time the price of i'll oil changes they change the number of barrels. oil is not the currency. >> the other news that has gotten play here, what he said about the keystone pipeline. he's always said he wouldn't make an argument against the pipeline but jim cramer wanted to know what he thought. he said if it came down to it if he had to vote, he'd vote in faber of the pipeline. &surprised people. one of his companies responsible for taking a lot and moving crude oil that comes out of
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there because there isn't a pipeline. >> interesting point. we'll see if he makes another energy investment. that's something people are talking about as well. let's get more on buffett watchers. jeff matthews berkshire hathaway shareholder and author of "secrets in plain sight, business and investing secrets of warren buffett," and robert myles, author of "warren buffett ceo". both shareholders and both authors of books about warren buffett. i guess you believe in his philosophy. let me start with you, robert, the fact here that warren's not beating the s&p by his own metric in the last five years, that's the tension here. do you think that's having an impact inside berkshire? >> no, i don't think so. warren doesn't beat the s&p historically when the s&p is enjoying two to three times its historical average. the time that warren performs and shows genius is when the s&p
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is underperforming other losing money. then he's able to add the most amount of value for shareholders. it's not a concern. he's up 18%. he's doing just fine. berkshire's a great investment. >> and, jeff, pick up where becky left off on the energy question. obviously, throwing his support behind the keystone pipeline. you expect him to make another big deal in energy here? >> absolutely. he came out and said in his letter, he talked about the deal they did last year in nevada, e said they'll do more deals in the future. he loves it, he can put capital to work at a regulated rate of return, assured rate of return over the years, and he's going to keep doing deals in that sector. >> on the subject of deals, i thought it was interesting in the letter he mentioned the heinz deal. an interesting sort of scenario because it was almost a shared deal in terms of financing. is this a new model for warren
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buffett and berkshire. >> i think warren said it's a model you'll be seeing more deal like that where he partners with somebody who brings him the deal, he puts up the cash, he'll give them preferred shares, he'll get a preferred dividend, and then eventually he will acquire the firm which is somewhat what he did with mid america energy and what he's done with heinz, you'll see more deals like that in the future. >> let me return to the fact that he's got half of the performance of the s&p last year and yet says that in leaving money potentially to his wife, he'll put that in a tracker fun. one thing he's not invested in is technology. that's one of the great winners. do you think that as the leadership of berkshire changes and of course he's in his 80s, that they will change their investing style or update perhaps for what's done best in the 21st century. >> well, i think you heard this
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morning on his three hours where todd combs shared his investment philosophy, very similar to warren where he said if he can't go out more than five years to see where a company will perform, he won't invest in them. so i think that the challenge with technology is trying to figure out where they're going to be in the future in order to safely invest today. so, if ted or todd are not comfortable, imnot sure you'll see a seismic shift in the way berkshire invested its capital after they take over from warren. >> there wasn't a lot of talk of the three ts leaving berkshire. thank you for the perspective on warren buffett. speaking of warren buffett, forbes bill air's list is out. who topped the list and who missed out? we'll speak with a "forbes" editor. apple is coming to a car near
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welcome back to "squawk on the street." i'm phil lebeau with breaking news no toyota. february auto sales coming in decline of 4.3, weaker than the street estimate. estimate for a decline of 2.5%. take a look at shares of toyota. mixed bag from automakers. interesting to see what the sales rate is for the month, many saying coulden as low as 15.3 million. >> we'll see you later on. phil lebeau. apple's announcing an ios powered carplay for your car's josh lipton in sunnyvale,
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california, with the latest. good morning, josh. >> reporter: good morning, carl. tech titans are fighting hard to get their technology into your car, and apple just made a big move in that ongoing battle. meet carplay, a new way to use your iphone in the car. and here's how the technology works. get in the car, you plug in your iphone 5s, 5c,5 and use this on board display to make calls, use maps, listen to music, or access messages with either voice or touch. greg, apple's vp of iphone, tell me it's giving iphone users constant access to smartphones. >> we do it for our customers, users, they'll have cars, want to great experience in the car. we don't want great experience with iphone to end at moment they walk into the car. we want it to get better and better. >> reporter: apple is teaming up
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with mercedes which isn't disclosing the price of carplay at this time. but mercedes is aiming to introduce carplay in its c-class vehicle by the only of the year. analysts tell me carmakers could charge up to $1,000 for carplay. it would have to be careful. consumers want technology but won't want to pay premium prices. besides mercedes, apple partnering with a range of carmakers including ferrari, volvo, down the road bmw, ford, gm and others. other tech companiy working har to introduce technologies as well. google partnered with audi. gm, honda, hyundai. apple wants you to use the operating system at home, at work, now in the car. mercedes tell me they want you to think of carplay as, quote, an iphone on wheels. >> to be clear here, you're
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showing the ipad or iphone on the dashboard. it more than that. there are -- they are putting the ios system into the car, it the first time they've put the operating system in a nonapple product. this is a huge move for them. >> reporter: it's a huge move for apple. again, first with mercedes. officials telling us they're hoping to have it in their c-class vehicles by the end of the year. it's not just mercedes. range of carmakers partnering with apple for carplay. back to you. >> thank you for that. josh lipton with latest on an until california. down 148 on the dow. over to rick santelli for the sanofi santelli exchange. >> i'd like to welcome our guest. thanks for taking time this morning. thanks. >> so we have data points start out there. there were big revisions taking away the income and spending from last month, leaving january
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basically unchanged. february, you noticed things regarding the personal consumption expenditure, which is a fed favorite, versus cpi specifically to renters. tell gl us. >> the gain was 1.2% but we saw a week cpi for the same month up 1.6%. the gap is between the cpi focuses more on or least higher contribution to housing, and which a lot of that is rent. rent of a home is running near 3% year-over-year which is well above the rate of income growth. the pec has a smaller component and higher medical care component moderating through the soft economic data. >> we have the most renters since '95. >> the lowest since then, which implies households are renting and that is a -- make the argument that's the largest cost of living expense for a lot of
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households, and instead conveniently it's not focusing on that, focusing on the pce which has a smaller component. they'll miss the inflation turn that will pick up because of rent but also rising commodity prices. >> not only that, think about it, the rent is going up, if you're a renter, 3% year-over-year. and if you owned it, you'd get form of price appreciation, so creating a pottersville scenario. switch gears a bit. there's no alternative, this whole aspect, call me flatterth, why is it exactly again that what's going on in ukraine is taking the aspect out of the u.s. stock market in it doesn't square with them. i would suspect we should have seen a better impact on the dollar but specifically, why is what's go on in ukraine causing selling in the u.s. stock market in your opinion? >> i think it's because of russia's involvement and the ripple effect that russia has in and of itself, whether them being a huge energy exporter to
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the reege. ukraine being a large exporter of corn and wheat. >> but all of those things, we'll take up the slack on the corn, ukraine's third largest exporter. i'm saying exports are a small function of our gdp. i'm surprised. you're not surprised on any level? >> i think this is a knee-jerk geopolitical mess that markets respond to. i would not be surprised by friday we're focusing on the payroll number and how the fed responds. if russia has a problem, europe has a problem. if europe has a problem, it's going impact the world because it's a huge economic trading partner. >> we have to wrap it up. didn't they have the chance on the game of risk to make a play to get ukraine in the eu? there were issues they didn't qualify for but that's looking like a rear view mirror issue they should have addressed in an aggressive fashion, yes or no.
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>> yes they should have but russia strong armed the pm of ukraine which is no longer the president in thanks for taking time. squawk "squawk on the street," you. >> next, soon to come at least, we'll sit down with a man that knows a thing or two about emerging markets, jim o'neill, former goldman sachs manage somewhere chairman will join us live. we'll get his take on the ukraine and his latest on the mint nations. back in two. do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today.
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emerson. to nbcuniversal's coveragens of the biggest loser olympic winter games ever, with the most coverage of the most events on every device. and the most hours of streaming video on the nbc sports live extra app, including the x1 platform from xfinity. comcast was honored to bring every minute of every medal of nbcuniversal's coverage to every screen. so what's next? rio 2016. welcome to what's next. comcast nbcuniversal.
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time to file the annual 10k, it implemented a new system to improvite financial disclosure controls which seems to have backfired. they can't catch a break at moment there the weather hasn't helped either. we haven't heart the quarterly earnings but a lot of expectations that it's not going to be great, given what's happened with the weather and the airline cancellations. activist shareholder, some in there, the proxy deadline passed without any action by anybody. we'll see whether they do move to spin off their equipment leasing business. >> want to talk about the economy now. we did get positive news on that front. accelerated u.s. manufacturing growth in february, plus monthly increases for consumer income and spending but of course ongoing instability in ukraine and russia, a rough start for
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the first trading day of march. want to bring in michelle meyers and our own bob pisani on the markets joins us as well. what do you make of the positive economic data reports now, given we're in this period where it's so hard to glean a sense of the economy because of the weather. >> exactly right. data's hard to interpret now. you have weather impact with hopefully starting to diminish role in the data as the weather conditions improve across the country. then you have this inventory cycle, we ended the end of last year with abnormally high inventories, the workdown can weigh on production as well. we're experiencing a period of some short term soft innocence data flow and expect that to bounce higher in the coming months. we're optimistic for growth this year. >> bob, the trader take on the weather has been sort of blame the weather, can't get a real sense of it. are they right or are there fundamental concerns that people
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should be looking at? >> i think that where there are some indications there's good news, i read that ism report every month because it's got comments from respondents in it and i was surprised how strong the ch commentary was. higher than normal demand for this time of year, strong month in terms of growth, we had a slow january, but somebody in machinist said, we're having trouble finding qualified machinists with all of this worry about the weather, mainly perhaps underestimating some underlying strength in the economy? >> it's funny, i did the same thing, i looked at the components, it was a weather story or optimistic strong commentary. i'm glad you pointed that out. i think that's right. there is probably good news to glean from this, despite the fact you had drag due to the weather, production picked up. new orders still improved.
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that shows that perhaps they're trying to see improving demand. durable good orders better in terms of core capital goods. we feel comfortable that it's short term weakness and we'll see stronger demand ahead. >> inventories, they appear to have been wanted not unwanted. if there's underlying strength won't we get rid of the inventories quickly? >> we will. if demand is strong enough, that will be manageable. if you think about it in terms of gdp impact, inventories is a residual. you're seeing less inventory, so it's a drag to growth. q1, it looks like we're going to see growth in high 1% range as a result of the inventory drawdown and weather from we know what a lot of commodities did in february. gold at 1350 today. where are you on the inflation, disinflation, deflation debate right now? >> we're in the disinflationary
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camp. we don't think we'll see deflation but we certainly doesn't think we're entering an environment, rapid inflation either. if you look at measures of the labor market, which it's getting harder to gauge as unemployment rate comes down, there are signs of under utilization, marriagely attached whatters, part time for economic reasons and that represents hidden slack in the labor market, and it will keep down pressure on overall core inflation. >> the last two jobs reports were disappointing, hard to predict. how do you go about making a model for friday's job number? >> it is not easy because trying to put weather variables in models have been frustrating. our baseline forecast is below consensus, we're at 115,000. we tended to focus a lot on the weather conditions during this survey week and they were poor, with a snowstorm that hit the east coast, particularly the
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southeast had a big shutdown in activity. we think that will result in weakness in the headline number. but as you suggest, there's a big rhyme for air flr this month's payroll number. >> 150, looks like consensus. >> they're the low on the street, aren't you? 115 are you at, that is right? >> we're not the low but we're one of the low forecasts. >> pessimistic as a group on the street. michelle, good to check in with you. bob pisani, see you as well on the markets. dom chu, this darden story, what happens go on? >> along the weather lines, darden restaurants, the worst performer on at s&p 500 today. projecting third quarter profits below estimates due to, guess what, bad weather, lower sales. cited higher legal fees for the spin-off of red lob terstster. live to kiev, ukraine, russian military consolidating forces in the crimea peninsula.
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the market taking a hit, too. we'll talk to former goldman sachs asset management chair jim o'neill who knows a thing or two about that part of the world. risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances. (announcer) scottrade knows our and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction
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second of state kerry will be heading to kiev tomorrow to meet with the country's new, embattled government. steve sedgwick is live. how would you describe the atmosphere? >> reporter: it's incredibly tense. events over the last couple of days have been extraordinary. of course, this new ukrainian government in power for two full days post the yanukovych ousting which cost so many lives, and protesters today taken to nearly 100 deaths that government face an invasion of territory in first two days as well. i'm been speaking about the movement of russian troops of ukraine territory.
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let's listen in to see what he had to say how we get over the situation. >> my message is that we will find a political and diplomatic solution despite the fact that russian military constantly provokes ukrainian navy and ukrainian forces, our forces and our soldiers are in barracks and we didn't use any force or live ammunition. and we asked russian president to stop his soldiers. no more russian boots on ukrainian ground. >> reporter: you can hear it in no uncertain terms, no more russian boots on ukrainian soil. the response, russian black sea giving an ultimatum to ukrainian forces left in the crimean peninsula saying if you don't
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sur rememb surrender by 5:00, you'll face an assault as well. he says we have twin crises in ukraine, one the financial crisis but the pressing is military crisis with russian troops on the ground in ukraine. >> steve sedgwick, thank you so much. more color on the global and fx markets. michelle caruso-cabrera you came from there and steve's right two crises, how do we handle them? >> yeah, those are great points. but i add something else, carl, the fact that the capital markets are punishing russia today in a way that diplomacy has not been able to do. we have focused a lot on coverage about the global market sell-off, the sell-off of stocks in the u.s. however, bond have rallied. look at every asset glass
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russia, investors are abandoning it. it's so bad the central bank had to raise interest rates by 1.5 percentage points. take a look at ruble over last week and see over the last year it's really getting hammered the russian stock market as well, the fall-off here in the last couple of days, look to right of the one-year chart, compelling a decline of 12%. capital flight leaving russia. does putin care about capital flight? trades of multiple between 4 and 6, pathetic for a massive oil producer in a world where oil is at the price that it's at. it's not clear. he's a wealthy individual. his people will suffer, his businesses will suffer, it's not clear he will suffer. let's bring up the price of oil, one thing to keep in mind, every single time we see the price of it rise, like we have today, it helps him out a lot because russia's one of the largest if not the largest producer of oil
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in the world, even bigger than saudi arabia. he needs oil high because they have spent so much money at federal level they need the price at 100 bucks or more. ten years ago they guys, back to you. >> michelle, that was good contacts around some of the market moves. michelle caruso-cabrera at headquarters. coming up, it wasn't just the oscars winners celebrating their fortunes. forbes out with its new billionaire list. but who was surprisingly missing from that list? we'll name some names. ameriprise asked people a simple question: in retirement, will you outlive your money? uhhh. no, that can't happen. that's the thing, you don't know how long it has to last. everyone has retirement questions.
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to nbcuniversal's coveragens of the biggest loser olympic winter games ever, with the most coverage of the most events on every device. and the most hours of streaming video on the nbc sports live extra app, including the x1 platform from xfinity. comcast was honored to bring every minute of every medal
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of nbcuniversal's coverage to every screen. so what's next? rio 2016. welcome to what's next. comcast nbcuniversal. forbes is out with the billionaires list this morning. back on top after a four-year hiatus he's back on top. it's good to be bill gates, isn't it? >> even better this year. he's been number one. we've been doing this 28 years, the world billionaires list, he's been number one 15 of those years. carlos has been number one for the past four years. he's the only billionaire in the top 20 that went down over the last year. and bill gates even though he's given away so much money, you include the money he's given
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away he'd be our first $100 billion person. but again, he's given away a lot of money. but he's still the richest man in the world. >> we're looking at the top five. there's gates, there's slim, ortega, buffett. i think what's more interesting is who you chose to put on the cover. >> yeah. it's the american dream. i mean, this is a guy who came to america from the ukraine. we were just talking about the ukraine. a kid as a teenager came here at 15 years old, his father passed away in the ukraine, his mother got cancer and died. he was alone here in america. he grew up on welfare. and when he signed this deal, this whatsapp deal, he tweeted out the picture and went to the welfare office where he used to get welfare checks and signed the deal. he's personally worth $6.8 billion and that's after tax. >> pretty good payday on that deal. i love this stat from your
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piece, a record net worth of $31 billion was needed this year to make the top 20. that's up from $23 billion last year. i guess the story there is bull market and these massive tech deals? >> yeah. $30 billion is the new $1 billion. i mean, we have 122 people in the world now worth more than $10 billion. so 11 digits is now something that's very achievable. the bull market, you know, when we see the markets go up of course all your viewers, they see what happens with their portfolio, that's exponential again with especially a lot of these tech people. retail's really hot. up 27, 28 new tech billionaires this year. we have 35 new retail billionair billionaires. people are buying things and technology, again, continues to lead. you see these flash fortunaes with these people in their 30s, early 40s, again, from zero to $7 billion amazing to watch. >> you got some old retail, so to speak, if i can call the
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walton family that. you add them all up and they would be number one if it was one person. >> absolutely. if you took the coke brothers together they made $80 billion. if you took the walton family, they'd be $140 billion. so incredible fortunes. if you look at incredible fortunes it still says something, they're still mostly in america. and if you look at, again, the surge we have almost 500 american billionaires now. america still dominates. and you still see, you know, again whatsapp is a great example. here's something that's used around the world. most people were surprised by whatsapp because people here in the states don't use it because we have text plans, but around the world this is ubiquitous it was an american company developed this bought by another american company. this list does say something about the continued dominance of american ownership. >> every year you brace for the critics, right? who would attack your methodology, people who think they should be higher on the
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list, people who think they should be on the list. how do you get around that? >> we have a we don't trust anybody. we check everything. we talk to almost all these billionaires at some point during the process. a lot of them are, we think, probably fibbing to get a little higher. a lot of fibbing to get lower on the list. and we basically look at the numbers and call it like we see it. again, a lot of these people are publicly traded. that's easy. private companies it's harder. again, we've been doing this for over three decades. we have miles and miles of files. a lot of expertise and we feel our numbers are as good as you're going to get. >> that's why it's still one of the most provocative covers in all of business media every year. randall, thanks for coming by. >> thank you. >> randall lane of forbes. dow down 49, not quite the lows of the session. we'll get back to the market moves and everything going on in ukraine in just a moment. [ female announcer ] who are we?
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all right. we are watching the markets. dow down triple digits now 136 points. tensions in ukraine. what we're seeing is this flight into safe haven assets. u.s. treasuries, gold, the dollar and japanese yen is what's taking us through this session, guys. >> there were some big losses in europe, guys, which i'll run you through in about half an hour's
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time. big, big losses on some of the banks and businesses that of course have moved into russia and actually physically own assets there. but that's for later. >> obviously very closely, guys. thanks so much. sarah and simon. today's road map begins with the markets as simon just said trading deep into the red due in large part of the tensions between russia and ukraine. we will take a closer look and show you the biggest losers so far this morning. >> and speaking of russia, this man coined the term bric which includes russia in the list of fast developing economies. jim o neil will give us more in a few minutes. >> and texas tech, best selling author and aspiring politician, try these words on for size, senator sheryl sandberg. >> and known for being the master of unusual transactions, so what does he make of the bitcoin phenomenon? star of "pawn stars" joins us this hour. >> what a treat, henry here the
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editor and ceo of business insider, i've been trying to get this to happen for a while. it's so great to have you. >> thank you for being here. >> we just got the forbes billionaire list and it's been heading to silicon valley. >> staggering. just a staggering number so fast out of nowhere shocked everybody. >> and culturally the oscars last night, somebody called it a three-hour commercial for twitter as the cultural war continues between them and facebook. >> and samsung, the selfies, absolutely. >> yeah. who do you think so far this year who have been the big winners in your view? >> well, obviously whats app. there are others out there like wechat in china is much more successful than whatsapp. this has been the boom of the companies. and they again are taking a lot of people by surprise. >> where are we in the cycle of all of this wealth creation in silicon valley, all of thein
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novation coming to these companies? how long can this actually last? >> that is the many billion-dollar question. but the wealth that's been created just over the last decade, especially with the comeback, it's staggering. it really is changing silicon valley, changing san francisco. you'd have to have a massive crash to disrupt what's going on. >> prices paid per user. i mean, you know all these metrics from back in the day. look at a twitter feed now there's a sock puppet when they're talking whatsapp. are they mild, nonexistent? >> i was shocked facebook's stock didn't drop sharply, not because i think it was incredibly stupid, but because i think it was incredibly bold. but for the market to say, okay, $19 billion, we'll take it on faith. that was very impressive. but if you look at wechat, if you look at line, these businesses are monetizable. and the base is so big if they just get a small amount from
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every user, it's not like an eyeball, it starts to work. >> do you think the comparison to time warner cable is unfair though? >> i think this is unfair. it's 8% of the company, aol and time warner is 50/50, huge assets that had to be combined. this is a long bomb. sometimes you complete those, you're worth it, you look like a hero. this could absolutely end up worthless. but that's why mark zuckerberg is where he is. just a very bold transaction. and i think it has a decent chance of working. >> i can't wait to get your take on icahn versus an dreeson. henry is here for the next 60 minutes. >> the big story is the tension in ukraine. it's part of the reason for today's selloff. chief commander of russia's fleet in the black sea, of course that is something we are watching. we have nbc's jim maseta live in moscow with the latest stories. jim. >> hi, kayla. the latest is that the commander
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of russia's black sea fleet has apparently issued an ultimatum to the ukrainian forces still on the crimea peninsula, at least according to to russia's state-run news agency interfax. the ultimatum says these ukrainian forces have until 5:00 a.m. local time, that's 10:00 p.m. eastern, to surrender or be subjected to an armed assault. now, we've got calls into the defense ministry and the fleet but haven't had a confirmation at this time. but already, kayla, russia's really firmly in control of crimea. its forces have either occupied or surrounded all government buildings, the ukrainian military bases and posts are surrounded. the ferry port and telecom towers are occupied. so putin already has in his hands the russian crown jewel. and of course it gives putin an essential warm water part and a base for that fleet.
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but it also counters what must be putin's nightmare scenario and that is that the ukrainian government in kiev certainly cancels the black seas fleet base and then takes over control of crimea and then joins nato somewhere down the line effectively bringing the enemy in putin's eyes right up to russia's doorstep. that is the big fear on the part of the russians who are there. kremlin watchers tell us that putin has made that calculus and it's really unclear what the west can do about it. so far this standoff now has gone on without a shot being fired, but that could now well change with this latest russian ultimatum if confirmed. kayla, back to you. >> jim, thank you so much. nbc's jim maceda working for us tonight in moscow. henry, your quick take on the ukraine. we know there's symmetry between how much this matters to putin and how much it matters to the west. is there a best case scenario
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out of this that doesn't involve him completely giving up? >> best case scenario it gets diffused peacefully, quietly over time. i think the markets are hanging in there fairly well given the potential for this to be catastrophic. >> yeah, we'll see, it's obviously a long day and kerry is going to kiev. we'll see how the story develops during the day. when we come back the biggest stories on tech on this monday morning. on deck sheryl sandberg reportedly eyeing a senate run. and an executive shakeup at microsoft. and rick santelli, what are you watching today? >> well, we're going to be kind of dissecting some of the data points today. something important in a revision on construction spending. we're going to look at income and spending and natural gas problem and our own natural gas export/import infrastructure and differences between zell and buffett all at the bottom of the hour. scottrade's smart text, i can quickly understand my charts, and spend more time trading.
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their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates. you can't always see them. but it's our job to find them. the answers. the solutions. the innovations. all waiting to help us build something better. something more amazing. a safer, cleaner, brighter future. at boeing, that's what building something better is all about. ♪
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markets just a stone's throw from down 200. take a look at i.t. this morning. one of the biggest losers in trading today. our don chu is back at hq with more on that. >> hey, carl, i.t. stocks are in the red. all sectors in the red, but this is the worst performing one. leading the decline alliance data systems and jabil leading declines. had disappointing earnings last week, it continues some of that downside momentum today. and then autodesk and f5
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networks rounding out the top five -- or bottom five if you want to call it that, but tech shares taking a hit in today's trade. back to you. >> henry's here for this morning's squawk feed along with jon fortt. we'll start with what could be big news on facebook's coo sheryl sandberg. she's planning running for a senate seat in 2016, seat currently held by barbara boxer who won in the 2010 election. henry still onset, jon fortt is here too. do we believe this? >> we do not. we talked to two sources close to sheryl sandberg who say it's completely bogus, not happening. that said, at some point sheryl sandberg in politics, i hope so and expect so. >> there was some expectation when last year it was the opening saga for a potential 2016 presidential run or an otherwise very large political appointment. what do you think about that? >> again, i think she's perfectly set up to go into politics. and i think it would be great for a lot of people if she did.
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the response though from her inner circle now is that this report is untrue. >> and this just smelled wrong right off the bat. she's been a reliable fundraiser for the democratic establishment in california. to throw a stink bomb like this in the middle of the party wouldn't make a lot of sense. wouldn't make her a lot of friends either. >> no, the sell side has always said her leaving is a negative risk, right? >> no question. but the more established facebook gets, the more there are other executives who could come in and take over the role that she plays. mark leaving, huge issue. sheryl leaving, huge issue, but there are a lot of executives who could come in and do that. >> it's tough though. who's got the high profile to do what she's done there? i mean, and plus she's got that trust with mark. it would be quite a blow if she would step away, i think. >> in the ipo perspective both mark and sheryl are listed under this key man risk. but for the last year people have said sheryl was out promoting a book and mark spending a lot of time on
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immigration reform so effectively has this company already been run by other deputies? >> the key thing for facebook is on the product side. they're monetizing very well. the advertising engine is running. they got mobile. they nailed it. that's why the stock has had such a good run. again, it would definitely be a loss, but there are great executives who can do what sheryl does. if we lost both of them, then we'd be talking about the future of facebook. >> and you mentioned zuckerberg's boldness with the whatsapp. >> extraordinarily bold here. he has the ability to because he controls so much of the stock even if everybody else thinks he's crazy. i would say sheryl is the, again, more of an adult, more of a conservative view, my guess is mark drove that. >> all right. from apple to a major shakeup over at microsoft according to recode two microsoft executives reporting ceo are leaving the company.
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evp of marketing tami reler, what do you think? >> the most important things out of microsoft are not the new products, it's who the trusted team will be. interesting that mark penn is sticking around, but i think maybe that has to do with his relationship with steve balmer. satya nadella still going to have to deal with steve balmer and pushback on strategy. here's somebody who knows how to communicate with the board. that makes sense to me. but i think it will be important to see how windows and office get treated. who ends up with influence over that. and cloud now that satya, he's ceo, he's not going to be running that as directly anymore. >> do you get the sense he'll be picking from loyalists within the company to him, or going outside to find other risk takers? >> i really don't know. but he's got the reputation in silicon valley in general to be able to pull in some talent. i'm not exactly sure where he's going to pull it in from. >> interesting. i do wonder we keep hearing about price competition between
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the chrome and windows 8.1. >> i think the best news about this is he is moving quickly. and that is what has to happen at microsoft. tremendous cash flow today, but the clock is ticking and it is ticking fast. they have to move quickly. >> yeah. finally it was the selfie heard round the world. this picture shot by bradley cooper at the oscars last night quickly became the most-shared picture in the history of twitter, retweeted over 2 million times during the broadcast. shatters the previous record of 780,000, which belonged to a picture of the president hugging the first lady on election night in 2012. i mean, could it have gone any better for twitter, jon? >> no, it couldn't have, i guess. but i don't think this is kind of a landmark moment for twitter. i think this actually exposes a weakness of twitter in that it's good for big events, it's great for celebrities. but day-to-day they don't have the growth metrics that are going to give them the answer to
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facebook whatsapp, for example. so, yes, ellen is on this big broadcast and says, hey, everybody retweet this and people retweet it. i think that shows perhaps the power of broadcast television more than the power of twitter. i'm not sure that twitter grew a lot in users who were going to stick with twitter based on that photo. >> let's put numbers in perspective, the most retweeted picture in history shattering all records, how many people watch the oscars? 50 million? these numbers are tiny compared to television. and this is what twitter's fighting is the growth just isn't there in the core business. >> if you're not going to retweet this photo, what are you going to retweet? it's got everybody. >> when they come on tv and ask you to retweet, right. what would you do for twitter growth? >> i think they have to keep working on the product. right now it's very much focused on tech media elite, people are obsessed with news and following celebrities. that's a nice chunk of the market. and twitter is worth a heck of a lot of money, there's no question. but they have not broken into
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the mass market for news and information. >> then what of the promole #motional value for samsung? she was using a samsung galaxy to take a picture of herself looking at the audience right before we saw a commercial for samsung devices. you can't deny product placement there, but do you think samsung will see windfall from that product placement? >> i think in general samsung's marketing has been tremendously effective. i mean, there are two companies that are making money in the mobile business, apple and samsung. and samsung has very good products. and they really put the marketing behind it, which apple actually isn't as aggressive about. it's definitely helped them some. >> i will say though it's not the most amazing photo ever. i mean, i don't know that you see this photo taken with the samsung galaxy and say, wow, i could never do that with my motorola phone or with my iphone. it's a photo. and samsung's name was all over it. samsung's name has been all over everything. and the phone that they were touting isn't out yet. we'll have to see what happens in the next few weeks between the competitors to see if this is really going to get --
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>> and for those wondering did twitter win the social media culture wars last night. here's a brief bit of sound from ellen degeneres at the oscars. >> so this is true, we just crashed twitter. we got an e-mail from twitter and we crashed and broke twitter. we have made history. see, meryl, what we did, you and i? it's amazing. we really just made history. it's fantastic. it's back up again. so it has most retweets ever. and we are all winners tonight, that's what it means. that's what i was trying to say early on. >> so we broke twitter. i guess you don't want memory of the fail whale coming back. >> right. >> on the other hand it's a nice bit of publicity. >> it's more attractive than the failed whale. maybe they should put that up every time they have that picture, every time they have a technical problem, this is what it looks like. you can enjoy that. >> although most of the failed whales hardly come from 2.7 million people retweeting that. >> no, no, it's great. now we can all remember this moment when twitter was broken by beautiful people. that can be the new whale.
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that's what i'm saying. >> all right. thanks, jon, for that. the one thing we should point out too is we saw a graphic earlier about where ellen was tweeting from. she alternated between android and iphone. if you take a look at that she was tweeting from her samsung galaxy on stage, but her iphone backstage. what does that flip-flop say to you, henry? >> we've seen this before. people using different things for themselves than they are publicly. >> check and see what alicia keys is using now. blackberry -- >> well, any publicity as they say is good publicity for all of these companies. but for now, henry, you'll stick around. jon, you will as well. thanks for adding your value there. still to come, jim o' neil probably best-known for developing the term bric for developing economies, but what's going on in one of those countries between russia and ukraine? he'll tell us in a few minutes.
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the events over the weekend gave an indication as to how we would trade today and in fact we are down 178 on the dow. there's the heat map. only one component in the green with a lot of news regarding ukraine still on the way. >> still haven't had a positive first day to a trading month since november. so certainly traders are watching that today. but keep an eye out on the roads as well. apple just got its driver's license. the tech giant is unveiling a new system called car play, which brings the iphone experience right to your dashboard. josh lipton is live in sunnyvale, california, to tell us exactly how it works. josh. >> yeah, kayla, apple wants you using its operating system at work, at home and even now while you're driving. apple unveiling car play, which is a new way to use your iphone in your car. you get in your car, plug in the 5s, 5c or 5 and use onboard display to make calls, access
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apps or messages even with your voice or touch. apple's v.p. of iphone tells me car play is intended to be smart, safe and fun. >> we've taken the legendary ease of use that people expect from apple and from the iphone and translated that to the car. again, starting with the idea that things should be as simple to use as your voice, but also then integrating and with the car's built-in controls in a way that's intuitive, it's simple, it's fun. and that makes it of course safer. >> apple is teaming up with mercedes, which is aiming to introduce car play in its c-class vehicles by end of this year. mercedes tells me they chose to go with apple because the two companies share similar demographics. and many mercedes owners already use iphones and apple products. analysts say car makers could charge up to $1,000 for car play. besides mercedes apple also partnering with a lot of other
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car companies including ferrari, volvo and down the road bmw, ford, gm and many others. other tech companies, they're working hard to introduce their technologies into your cars as well. google, for instance, partnering with audi, gm, honda and hyundai to bring its android platform to cars this year. android saying the battle for your car is just starting. they expect it to intensify from here. but apple trying to get out ahead with this news today. guys, back to you. >> josh, thank you so much for that. jon coming off of the meeting last week, what does this all mean? >> i think it's important to note this is your car kind of acting like an accessory to your iphone. it's not as if they're putting ios directly installing it into the car. it will be interesting to see how far they can extend this. can they power the video screens in your backseat with your phone too? that would keep the kids occupied. that would be nice. i don't know. >> you just described heaven on earth is what you just did. >> i'll stop there. but you can see lots of nice
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possibilities. >> but it's not cheap. i mean $1,000, who can afford that? >> you already have a screen. you take your iphone in your car, you've already got it, use siri, everything else, connected cars is a huge opportunity, but this for apple is a small, small thing. >> all right. we want to update you on an earlier story. sources close to facebook coo sheryl sandberg say the daily mail report she would make a senate bid in 2016 are "100% untrue." something, henry, you had said at the top of the hour. jon, we'll go with that for now, right? >> i'm leaning in as far as i can go, so at least it seems like she's sticking with her current -- >> we don't want her falling over. meanwhile, up next the man who coined the term bric weighs in on russia, ukraine and the u.s. economy. former goldman sachs chairman of asset management jim o'neil will be here in just a short moment. and the bells are about to sound across europe. just a few moments left in their day. details right after this short break. ting ]
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welcome back. we're just a minute away from the close of the european markets. we want to bring in simon hobbs. a lot of red today. >> this is the reaction you see in the markets to europe's most dangerous crisis since the fall of the berlin wall. the selling is having 97% of top stocks in negative territory today. you'll see a different view from european politicians who are much more softly, softly, much more going for diplomatic solution. one of the major reasons for
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that is this is the ukraine, is that so much of russian -- so much of the imports, 40% of all gas and oil imports come from russia through the pipelines in ukraine. this is an area putin is nervous about at the moment. one of the major concerns they have is not just the businesses in russia but that the financial conditions can worsen in russia. the ukraine owes about $30 billion to the russian banks. what happens if that isn't paid? what happens within russia? let me show you some of the big banks that have fallen around europe today. as i say it's a mass selloff that you've seen or a mass markdown. there is a contagion risk for markets. things could get much worse in russia itself. trying to sell a banking subsidiary in the ukraine which is why it's down. and then let's look at those businesses that have invested heavily in russia. what happens if there are sanctions and putin reacts to
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those sanctions with real assets? you know, russia has a history of using the courts to misappropriate foreign assets. could they do it for example on these others? guys, can we change this board? i want to show who's directly invested in russia. you might not know the names, beer, retail, this is generic drugs, this is a big builder and this is a finnish tire maker. look how those guys have fallen though it has to be said we have stabilized towards the end of the session. back to you. >> simon, thanks so much for that. simon hobbs, obviously the single most important story facing global markets today. we have markets under pressure all around the world in large part because of what's happening in ukraine. we want to bring in jim o'neil, former goldman sachs asset management famously coined the term brics. >> how are you doing? sorry i can't be with you on video or any other way. >> well, we'd take you by morse code if had to especially on a morning like this. what would you take to break
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movement as simon was just describing? what happens right now? >> well, i'm no geopolitical expert, but i can't see why this matters that much for the rest of the world despite how troubling it is. but i think the economic sanctions is probably the more likely. but the more i think about it i think one has to be objective and put my hat on if i were one of the decision makers, you want to be objective and not emotional. as is often the case with something coming out of the european region. so to react too emotionally to something they've sort of created a bit themselves it would be dangerous. i think the germans given the
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economic sanctions are only going to really work if people want to do them if the countries would get hurt most stick to them. so obviously the germans have the closest trade relationship with the russians. and they import a lot of energy from them. so you want to make sure the germans on board or might be the ones to think through the smartest way to approach this. >> jim, the threat from the west is to have russia pull out of the g-8 or to force it out. what happens to the market and how is it to move like that and how likely is it? >> well, to be honest with you, it might do the dysfunctionalty of the g-8 a final favor by killing it. i mean, the g-8's been a joke for the best part of a decade anyhow. why is russia the only bric country in the g-8? over a decade ago we thought they'd become exactly like the following year. and so it's a bit of an
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imbalancement anyhow. what i would -- and i'm in the process of writing a piece i'm going to publish on this, in an open minded bold policy thinking world what i would look to see is this is the beginning of a move to much smarter and faster changing representative global government. so why not get rid of the g-8 and shift the g-7 into something which is more representative and in particular having china involved. the g-8 is a bit of a joke anyhow in my opinion. doesn't really serve any use or purpose in this modern complex world. but all of this mess demonstrates we change the world economically, but we have hopeless governments. >> jim, henry blodget, how is the market likely to react over the next few weeks? what news will come out? will ultimately the market get used to this? do we continue to freak out about it? what's likely to happen? >> well, henry, you know, you
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guys know as well as i do once you start to see things moving in the speed we're seeing today, they hardly stay stable. so i don't know whether we've seen the absolute worst of the equity reaction just today, but i would think things are going to get worse or better, that's the first obvious statement. second one is i think it depends on -- i mean, if there were some undesirable military developments involving outright hostilities between the ukraine and russia in the short-term, i think that would make things a lot worse and cause equity markets to decline further. what i would -- which of course we can't rule out. what i would hope personally to see as i said at the start of this discussion is that the germans lead some sensible and well-thought out economic
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response which at least western allies could stick with to try and make sure russia realize that there's a cost to these kind of things. i quickly ask we're starting from a weak position because russians have only got in this to some degree because they lent ukraine all this money because we in the west didn't want to give them any money about five, six weeks ago. so, you know, but i think it's going to remain messy. but i think we have to look at the economic versus the military. if i saw germany taking the lead on an economic approach, that would give me a little bit more comfort because they're the ones are likely to be the most logical because they have the most to lose. >> which is why it's disturbing to get reports that merkel says putin's living in another world. but that's a discussion for down the road. jim, last question, x ukraine, absent everything that's happening there, your general sense on europe coming back, the debate on inflation or lack of inflation, how are you feeling?
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>> well, you know, indicators are looking by europe's poor standards okay. but we have a very fragile situation without this disturbance. and of course the inflation is not shifting into outright deflation, it's low on the japanese pile as much as -- big event in europe about all this mess. we need to see germany being prepared to upset a bit higher inflation to itself to stop putting this perpetual downward pressure on all the others. so it's a very sort of unstable state of affairs even without this ukrainian-russia mess. that said, i think the parts of the peripheries that have gone through the crush like spain, portugal and island, i think these guys are doing better than people give them credit for. but we need germany to think
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outside of its standard paralysis on more traditional economic matters as well as issues related to this ukraine mess. >> yeah, so much rides on what they want to have or see done. jim, thank you for your time. i'm glad we made it happen even on the phone. we'll talk to you soon. >> thanks. speak to you soon. >> jim o'neill. as tensions rise between russia and eukraine, secretary of stat john kerry is on his way to kiev. our john harwood is in washington with more on that. >> good morning, carl. i think part is john kerry showing his presence and the presence of the united states in a very difficult time for this new government. he's arriving at the same time a team of imf economists are coming to begin to take stock of what sort of aid might flow to the new government of the ukraine. john kerry has talked about the united states loan guarantees in addition to whatever the imf ultimately comes up with.
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but, you know, there's not a whole lot of levers that the united states can pull. there is talk, as you know, about suspending the preparations for g-8 and perhaps kicking russia out of the g-8. i think our european allies want to go very slow with any steps like that. and there's a limit to the amount of leverage we actually have. there's sanctions against russia, perhaps trade and technology and energy exports are one option. but there aren't a lot of great options. and we don't have all that much leverage. so part of this is about rhetoric and presence and trying to lend the united states -- the united states lending a stabilizing force to ukraine at a time where russia holds most of the military cards. >> all right. john, we'll see what happens when he makes his travel to kiev. thanks for that, john harwood in washington today. switching gears, still ahead, the star of "pawn stars," rick harrison, of course deals directly with american consumers every day. we'll find out what he has to say about spending and the state
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of the economy. dow's down 185. we're back in a minute. what can your fidelity green line do for you? just take a closer look. it works how you want to work -- on your own... or with a fidelity investment professional, helping you find new ways to plan for retirement and save on taxes where you can so you can invest in the life that you want today. tap into the full power of your fidelity green line. call or come in today for a free one-on-one review.
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you can afford a sleep number bed, you can't afford another mediocre night's sleep. know better sleep with sleep number. predibut, manufacturings a prettin the united states do. means advanced technology. we learned that technology allows us to be craft oriented. no one's losing their job. there's no beer robot that has suddenly chased them out. the technology is actually creating new jobs. siemens designed and built the right tools and resources to get the job done. coming up at the top of the hour, we're hunting for value with ariel's john hunter. he's going to reveal three new stocks to buy right now. and the oscar goes to twitter and samsung. what hollywood's big night means for them and their competitors.
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plus, how worried should you be about the unrest in ukraine? our experts answer that question and many more at the top of the hour. carl, see you in about 20 minutes or so. >> sounds good, scott, thanks. let's get over to the cme group and check in with rick santelli, hey, rick. >> hi, carl. we have three areas i'd like to cover. we're going to be moving quickly. first fell on the data this morning. personal income and spending for january came out pretty good, all things considered. one thing that was a fly in the ointment that caught my eye is december on the income side unrevised at a goose egg, unchanged. what was originally released up .4 on spending for december only moved to up .1. not good news. we need to pay attention to that. construction spending came out late if you recall because of all the weather issues with regard to government offices, but it did eventually come out. and the january read was up 110. but what i found fascinating is like the income and spending we had a revision to december. originally released at only up .1, now standing at up 1.5.
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that really does say there are weather issues, but not necessarily hugely impacting a variety of markets. we all know in housing there are different pockets of the country that were doing very well. it's an important area. we have to handicap to see if the markets have it right. last but not least, what's going on in the ukraine gas problem, natural gas, the politics of everything, there's been a lot of emphasis on the natural gas part. and it just reminds me i remember a story i read on the 17th of january this year from reuters, european countries anxious to buy european gas. an older story in "new york times" from 2011 that talked about all the problems liquefy natural gas, building infrastructure and department of energy doesn't seem to be behind this. can't even build a keystone pipeline. but this is an issue we in the u.s. should think about. and we should further advance the technologies of fracking because one of the big hammers that russia has over not only the ukraine and europe in general is nat gas. and i think this is an important
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issue. now, sam zoe on the channel friday and he said something i found fascinating, throw it up on the screen. i'll read it quickly. there's a guy, jim grant, who wrote an article about the shot clock in basketball. i think zero interest rates are a lot like not having the shot clock in basketball. and this morning we all know warren buffett's -- everybody loves warren. and today with becky quick he didn't really agree with that. he said he invested a record $11 billion in berkshire hathaway and likes investing in train cars. and the other thing he said freights were 15% i might not be investing. that's the point though, warren. first of all, trains and planes and automobiles, if you're in ownership at zero interest rates and we have this energy craze, i can understand the investing, but it's if business thought rates were going to 15. those that are sitting on the fence would invest. and i think that was the point of mr. sam zell. carl, back to you. >> thanks, rick santelli. take a look at markets right
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now. we are now officially down 200 points on the dow for all of the major averages, dow, s&p and nasdaq looking at the worst day in exactly one month since february 3rd as we are back now to 1839 below some key critical levels. and gold another story today. up $32. 13.53 is a long cry from 1200. we know gold's up more than 10% this year. long before banks, atms and bitcoin there were pawnshops. after 28 years running the gold and silver pawnshop in las vegas, rick harrison, star of the history channel reality series "pawn stars" is an expert. he joins us this morning in an exclusive from las vegas. rick, great to have you back. good morning. >> thanks for having me. >> i want to get your take on how consumers are feeling, but first i got to ask you about gold. are we in the middle of something, a new leg up do you think? >> i personally believe it's going to be probably around 1400, that's where it's going to top out for the rest of the year. after that who knows, but that's
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what i'm more or less betting on. >> what's driving it, do you think? we've had you on before, we talked about the fed, you had some choice comments for bernanke and company. now we have yellen, where's your head right now? >> people just look at gold as like it's a store of wealth, it's a great insurance pollty. that's what i always tell people. don't put the bank on it, it's a nice insurance policy, that's where you should put some of your money. >> rick, pawnshops have always been a source of credit from those who can't get it from your traditional sources of it, what types of credit are consumers asking for right now? payday loans? what else are they saying? >> well, i don't do the payday lo loans at all. it seems like -- i deal with a lot of construction workers, i deal with the whole spectrum of society. and the thing is no one can get no overtime, no one can get --
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you know, everyone's more or less stuck at where they're at. and it's just hard making ends meet. i mean, you take construction guys, a lot of different industries, every once in a while there's that overtime that gets them over the hump. none of that's happening at the moment. >> rick, henry blodget, have you seen a change in the last few years just in terms of a trend of what's going on now? more credit, more pawning? anything changing in the economy? >> no, that's the problem. it's just staying so flat. there's no new jobs. there's no, you know, businesses are unsure. they're not investing a lot. i own multiple companies, and i had a meeting the other day and we still don't understand the health care bill. so those are some of the big problems at the moment. it's just understanding -- not knowing what's going to happen down the road with the government regulations and everything else. that's what i think the big stall is right now. >> yeah. i was talking to a restaurant ceo who's trying to put in order
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all of his franchisees concerns. you mentioned obamacare, but there's also the brewing minimum wage argument, other things people have to worry about. where would you place health care on the list of concerns? >> for a business owner it's number one or two at the moment. i just don't -- i mean, i was talking to a u.s. senator a few weeks ago and he basically told me if anyone tells you they know all the rules at the moment, they're lying. because there's new regulations that pop up every week. >> how about bitcoin? >> bitcoin? >> yeah. a big week last week -- yeah, was that a lehman-like moment for you? >> okay. i'm just saying dutch tulips as far as the bitcoin goes. it's a currency someone came up with that it's a fiat currency like everything else, but when you take the dollar and other -- or other fiat currencies, the one thing it has going for it is that's the only other thing the government accepts in taxes.
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the bitcoin is, like i said, tulips. >> what would you need, rick, to legitimize bitcoin to make a business owner like yourself comfortable with accepting it? warren buffett said it's not a currency. he doesn't know what to call it, doesn't think it will be around in ten years. how comfortable would you have to be to be comfortable? >> due to the fact it's a currency not backed by the government, the only thing that would make me comfortable is like an etf or something backed in some sort of commodity. that's the problem. it's not backed by anything. you don't physically own it. and, like i said, i don't believe this will be around five years from now. >> and one of the points that bitcoin fanatics make is it's so much better for merchants because they're much lower fees, if you take bitcoin versus credit cards. does that argument hold any water with you? >> no. and much of young guys i've talked to are all big on it. and i try to get them to the
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whole meat and potatoes of it and all they can tell me is it's cool. it's so easy to do a transaction. but i'm just -- there's nothing real there. okay. either a government accepts it for taxes or there's a commodity or some sort of asset behind it. i would never take it in my store, let's put it that way. >> rick, you know as well as we do the champions argued that is the beauty of it, right? it takes out the middleman, it takes out the government. it's libertarianism in its purest form. that's not good enough? >> no. i mean because there's nothing there. and what's to stop the people who make bitcoins from making more bitcoins? i mean, if you made more bitcoins and threw them into the mix, there's no way to really tell if they're counterfeit. it's -- like i said, there's nothing backing it and no government will accept it as taxes. >> yeah. >> it's a bubble. >> yeah. we're going to have to wait and see how it all flushes out.
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rick, it's great to see you. please come back soon. >> thanks for having me, guys. >> rick harrison of "pawn stars" joining us from las vegas. >> we want to send it to dom for a quick market flash. >> airline stocks taking a quick hit this morning, 2,300 flights have been canceled as the latest storm hits the east coast. on sunday 2,000 flights were canceled in the midwest. it's been a tough winter for the airlines and air travelers. since december 1st more than 87,000 flights have been canceled, couple that with rising fuel prices today and you get that downside move in those major airlines. kayla, back over to you. >> thanks for that, dom. up next is the situation in ukraine escalates, the president on the council of foreign relations joins us with his insight. you won't want to miss that when we come back.
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checking in on the markets, right now we have the dow near session lows down 201 points, the s&p is also down 19. nasdaq holding solid into the red as well. of course, all markets are watching the situation in ukraine as it has escalated. we want to bring in richard hos, thank you for joining us. >> great to be with you. >> the first question is the obvious one, which is this is a standoff in its clearest definition. what is the most likely next
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move? >> so much really at this point depends upon mr. putin and the russians. what none of us knows is whether what he's done in crimea lends simply to give him a trade so he can maybe get some influence back in the rest of ukraine. we don't know if he's decided that game is lost. so this is a way of compensating and he's going to hold onto this. or even worse, we don't know if this is something of a steppingstone from which he's going to try to expand his control over big parts of the rest of the country. so we don't know his agenda. and what we're trying to do is influence his choices at this point. >> what signals would you be watching for to try and determine what that agenda for president putin looks like? >> well, one is if we're offering, for example, russian participation in any sort of economic package that may be put forward to ukraine along with say protections for russian citizens in crimea, whether that's -- something like that
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they show any interest or it's dismissed. we're going to be looking at whether they continue to do a military build-up. we'll look at what they're saying in terms of what they almost seem to be looking for provocation. odds are at some point some individuals are going to take some shots at russian troops. and the question is whether they're going to use that, if you will, as an excuse to expand what it is they're doing. >> richard, you know, even some western observers have argued that the way the new government came to be in the past couple weeks cuts some corners constitutionally. does putin have an argument on that front? >> well, what happened was you had an elected government that was essentially forced from power. that's simply a fact of life, but what you have is also dysfunctional ukrainian politics. this is nothing new. and none of that ought to have provided a pretext for what mr.
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putin did. what the russians did was was extralegal. the russian-speaking people of crimea were in danger, there were all sorts of ways consistent with international law to protect them, but mr. putin acted unilaterally. he violated any number of international undertakings and obligations. i would not put great weight on their position. >> all the while, richard, ukraine is deep in a financial crisis. our market here is down 216 points today as some of this fallout continues. it needs that economic package. it's on the brink of bankruptcy. what's the likelihood that it can reach one of those very key packages without russian participation? >> well, the principle it could, but you make a good point. you have a degree of political disarray in kiev. so what i'm beginning to think about is it's going to be very hard to negotiate a large long-term economic package with an uncertain political
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leadership in kiev. so what we might need to think about is tranching it. maybe have a couple of billion dollars go there essentially unconditionally just to keep things glued together. and then to have a larger package that would be negotiated over the course of the next couple of weeks or months where conceivably russia would participate if they so chose. but i think we're going to have to do this in phases given the need on one hand to russian some emergency money, but on the other hand the political confusion in kiev. >> richard, thank you so much. obviously a long day ahead still. we appreciate your time as always. richard haass joining us on the council of foreign relations. thanks to henry blodget here at post nine. i didn't have as much time as i wanted, henry, to talk about icahn and andreessen, but in a word how has carl been effecting the valley? >> i think he's been unfair to marc andreessen, making
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justification to paypal, i think that's good. >> inconsistency and the latest one today. scott wapner will have more on that on the halftime coming up right about now, right, scott? >> we are indeed, carl. thanks so much. noticing mashlgts are at the lows of the day. real flight to safety today, carl. you see wlast going on in gold and yields are dropping as we speak now under 2-6 on the ten-year. >> yeah. and hearing from rick harrison from "pawn stars" made it seem like it's going to go higher. >> yeah. have a great rest of the day. welcome to "halftime show." here's what we're following, putin and your portfolio. what the aggression in ukraine really means in the markets. we're covering it this hour. and ariel investments return. and the oscar goes to h


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